.ADDRESS BY THE RT. HON. IAN SINCLAIR, MINISTER FOR COMMUNICATIONS TO THE C.E.D.A.

GROUP OF TRUSTEES ON FRIDAY, 11 SEPTEMBER, 1981, AT 5.45 P.M.

"SMALLER GOVERNMENT AND SELF-REGULATION - SOME PERSPECTIVES IN RELATION TO COMMUNICATIONS"

I decided to take "Smaller Government and Self-Regulation" as the main theme of

my address this evening. It is fashionable to expouse the case for smaller

government, and editorial writers take up that cause with great enthusiasm if

not with any vision of how smaller government can be achieved in the complexities

of society today. ,

"Self-Regulation" could be seen as a corollary of smaller government. The

starting point of many arguments for smaller government is that governments by

nature over-regulate industry and society resulting in an overweight bureaucracy.

Smaller government, therefore, in that view, means less regulation and fewer

public sector employees, but this is not linked in a philosophical sense with

reducing the number of elected institutions which, in fact, employ the officials

to implement their regulatory policies.

No doubt regulatory structures are established for good reasons seen at the time,

and these structures seem to have a natural instinct for survival because of the

lack of the will or the interest to review from time to time the need for

particular matters to be regulated, or to be regulated in a particular way.

If you have to cast blame for why this is to, you would have to end up with

criticising the people elected to exercise powers of government. It is not the

nature of institutions which are given responsibilities to regulate particular

matters to recommend their own abolition or a diminution of their powers. There

has to be a continual public questioning of the merit of regulation in particular

areas to have sensible discussion and to influence elected representatives to take

a serious interest in the matter.

The Commonwealth Government has just had a cleansing of its own house through the

Cabinet Committee which reviewed Commonwealth functions to see in what areas it

would be proper for the Commonwealth either to withdraw or to reduce its involvement.

Some of you may have been disappointed with the published results of that Review,

For the Government, I could not say to you tonight that we have abandoned or

abolished a number of Government authorities or Public Service positions by

declaring that we have found that there is unnecessary regulation over a wide area

of Commonwealth activity.

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The decisions which flowed from the Review of Commonwealth Functions are, however,

more pervasive than might be readily understood, and I will refer to that issue

again later when talking about my own portfolio. It is important to remember

that each Minister has been asked to scrutinise every authority within his portfolio

responsibilities and to report on the need of that authority to continue and to

exercise its present functional responsibilities. When I think back on a portfolio

I held previously - Primary Industry - my colleague, Peter Nixon, will be having a

busy time in examining the many Primary Industry Boards for which he is responsible.

The basis of any regulation must be that it is in the public interest - however you

might define that expression - that there be some regulation of a particular activit)

Once a decision is made to regulate, the pernicious effects of over-regulation must

be avoided. To some extent, over-enthusiastic control by regulation has been met

by establishing special tribunals, such as the Administrative Appeals Tribunal, to

hear appeals from decisions of officials and authorities exercising discretionary

statutory powers and by vesting the Courts with greater powers to review the way

in which Executive powers are exercised. The Judicial Review [Administrative

Decisions) Act was, in my view, a major innovation by the Government to simplify

procedures for the community to obtain a Court review on how executive powers have

been exercised.

Traditionally, communications has been subject to considerable regulation.

Broadcasting is perhaps the classic example of regulation of an industry. There

are good reasons for this. Broadcasters, whether they are radio or television

broadcasters, use the valuable spectrum space which, under international rules, is

allocated within Australia for broadcasting purposes. There is, therefore, a finite

number of radio and television stations which can be accommodated within the

broadcasting bands. There must be some mechanisms established, therefore, to

determine the number of licences available and how licences are to be granted

amongst competitors. That might not be a major problem, if a broadcasting licence

were not a valuable commercial right.

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As the licensees use spectrum space, which is a public property, the argument then

runs that people granted licences have special community responsibilities. They

are therefore â regulated in the question of standards in various matters, these

standards being determined now by the Australian Broadcasting Tribunal. They are

also required *to justify their continuing to hold licences through licence renewal

procedures.

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The commercial broadcasting industry, both radio and television, believes that the

industry should be self-regulating, or should, at least, initiate its own standards.

This is opposed by various interest groups, which consider that standards must

continue to be set by the Australian Broadcasting Tribunal. The frequency of

commercials, the interruption· of programs for commercial breaks, the number and

quality of children's programs, the fostering of local creative talent, and acts of

violence are some of the issues in which there is some public support at least for

continuing regulation through a Government authority.

The Broadcasting Tribunal will soon commence an inquiry into the introduction of

cable television and subscription off-air television, submissions on these matters

having been invited some time ago. Cable television does not, however, require the

use of radio spectrum space for distribution to households. Depending on whether tb

distribution system could provide between 30 and 100 programs for reception on the

home receiver. If cable television is introduced here, it could be expected to

achieve at least some of the popularity experienced in North America where the

distribution of television programs by cable has led to a soaring demand for access

to domestic satellitesL

Cable television would obviously be a competitive source to programs offered by '

radiated broadcasting signals. As distribution by cable does not require access to .

the radio spectrum, the argumment that commercial broadcasting requires a high order

of regulation because it employs the use of a scarce resource will hardly apply in

the case of cable television. A question to be considered is whether cable televisio:

requires regulation in the same way as radiated broadcasting services. Given the

capacity of a cable system to provide a large choice of programs, it might seem a

respectable argument to say that "market forces" should determine the number of cabl

services, the Government merely setting out the technical specifications, which the

services would be required to comply with. _

If cable television produces the greater diversity in program choices available to

the community generally, the policy of limitation of interests in the ownership of

broadcasting stations, which is strongly entrenched in the existing Broadcasting and

Television Act, may also need to be reviewed. To a large part, this would depend on

how cable television is introduced here, the acceptance of cable services by a

significant part of the Australian community, and how industry assesses the

opportunities for the large capital investments which will be required.

Looking at the general scenario in the medium term, I cannot foresee any radical

reduction in the Government's involvement in what I might call traditional broadcast

ing services. One of the complexities to be considered in respect to cable services

will be the amount or measure of regulation necessary for the introduction of such

services without stifling the entrepreneurial interest of the private sector.

Another important dimension of the involvement of Government in Australia is the protection of smaller sector interests. For example, if Western Australia, were to be dominated by eastern states advertising, there is little doubt there would both